MTA payroll tax struck down

Aug 23, 2012

A New York state supreme court judge has ruled that the Metropolitan Transportation Authority's controversial payroll mobility tax is unconstitutional. Hudson Valley Bureau Chief Dave Lucas reports.

The ruling came in response to a lawsuit filed back in 2010 by officials in Nassau County. Several other municipalities in the Lower Hudson Valley, Putnam and Westchester and Putnam counties among them, later joined the lawsuit to have the MTA tax overturned.  

The tax was approved by former Governor David Paterson and the state legislature in May 2009 in order to avert service cuts as the MTA faced a record deficit.

State Senator Stephen Saland say this should be a wakeup call for the MTA to restructure the way it does business.  The tax, originally imposed passed as part of a bailout package to help the MTA, was intended to raise $1.5 billion to help close the transportation authority’s $1.8 billion budget gap. Judge R. Bruce Cozzens on Wednesday said the tax "does not serve a substantial state interest" and therefore needed home rule messages, which allows the state to engage in local matters.

Ellen Daley ,Vice President of Communications for the Orange County Chamber of Commerce, says the Chamber has fought the MTA payroll tax since it was first imposed.      The MTA, which operates the Long Island and Metro-North railroads, and the New York City transit system, says it "will vigorously appeal" the ruling.

Ryan Lynch is the Associate Director for the non-profit Tri-State Transprtation Campaign - he says if the ruling holds "it's a bad day for transit riders and for the economy in New York State."  The campaign emphasizes that “New revenues must be found, through congestion pricing, tolling or other means”